In Peoples Department Stores Inc

question 31

Multiple Choice

In Peoples Department Stores Inc. et al. v. Wise et al., the Supreme Court of Canada had to clarify to whom a director owes its duties. What did the Court hold?

• A) A fiduciary duty is owed only to the corporation, while a duty of care can also be owed to other stakeholders.
• B) A duty of care is owed only to the company, while a fiduciary duty can also be owed to other stakeholders.
• C) A fiduciary duty is owed to the company and to other stakeholders.
• D) A fiduciary duty is owed only to creditors, while a duty of care can also be owed to other stakeholders.
• E) A duty of care is owed only to creditors, while a fiduciary duty can also be owed to other stakeholders.

---

Definitions:

Moral Hazard

A situation in economics where one party takes more risks because they know another party bears the cost of those risks.

AFLAC

An American insurance company known for its supplemental insurance products for individuals and groups at workplaces in the United States.

Asymmetric Information

A situation in which one party in a transaction has more or superior information compared to another.

Adverse Selection

A situation in insurance and other markets where buyers and sellers have asymmetric information, potentially leading to market inefficiency or failure.